GroupM

Report by Irwin Gotlieb (below)Chief executive officer

By the end of 2010, GroupM once again found itself the undisputed worldwide market leader among all global media agency networks. RECMA, the independent organization that measures media agency sector operations, reported that GroupM held almost a 29% share of the total measured volume among all its competitors with $73.3 billion in worldwide billings. In its report, RECMA said: “GroupM is leading the race by a considerable margin (almost 30%) on its closest challenger.”

The primary goal of GroupM is to provide support for each of our operating companies – Maxus, MEC, MediaCom and Mindshare – as both a parent company and collaborator. We focus on activities that benefit our clients, such as trading, content creation, digital communications, new business, finance, proprietary tool development and other critical capabilities.

Like all companies, GroupM felt the impact of the global economic recession that began in 2008 and lasted into 2010, but at the same time we began to see signs of improvement as the year progressed and the economy improved. Our agencies experienced significant new business wins around the globe and also benefitted from varying degrees of organic growth from existing clients. The account wins, along with industry awards, are outlined in the individual agency accounts found in the following pages of this report.

GroupM continued to focus on developing new initiatives designed to...maintain our global reputation as a pioneering influence throughout our industry

Throughout 2010, GroupM also continued to focus on developing new initiatives designed to keep our company at the forefront of the media services business and maintain our global reputation as a pioneering influence throughout our industry. This was especially true in the digital communications arena.

We have been at the forefront in the development and deployment of advanced DSP (Demand Side Platform) and RTB (Real-Time Bidding) platforms. These technologies have been developed in partnership with the MIG, our Media Innovations Group, along with our WPP technology partner, 24/7 Real Media. These developments will become increasingly important during 2011 and beyond as more of our clients’ investments shift to digital media and the focus of the investment shifts to identifying and acquiring highly-targeted audiences. These platforms also rely on robust data capabilities, which we have developed in conjunction with our partners at 24/7 Real Media.

GroupM showed progress in several other areas throughout 2010. For example, in the spring we launched a new division dedicated to corporate trading. Dubbed the Midas Exchange, the unit is dedicated to helping our clients secure media credits in exchange for underperforming assets. The Midas Exchange was formed at the request of clients who asked that WPP, in cooperation with GroupM, enter the corporate trading arena to complement current services, seamlessly deliver a media plan consistent with objectives and be fully accountable for the total media product.

GroupM also took an important step in 2010 to address the issue of diversity in the advertising and media industries. In the fall, we formed a new partnership with the City College of New York designed to identify and cultivate college students for careers in the advertising industry. The program, called the GroupM Professional Development Initiative, is available to students in CCNY’s Advertising/Public Relations Program with an emphasis on undergraduates with ethnically-diverse backgrounds.

In other areas, GroupM continues to be a leading prognosticator of worldwide advertising spending in both traditional and digital media, issuing several This Year, Next Year forecast reports throughout 2010. Last year we published local forecasts covering the UK, Russia, China and India, as well as a worldwide report that received widespread press coverage and was presented at the annual Global Media and Communications Conference, hosted by investment bank UBS in New York. The worldwide report, traditionally issued early in the year, is then updated and released about six to eight months later. We also published Interaction 2010, our fourth annual point of view on the state and future of the digital media marketplace with an analysis of what it means for the world’s largest advertisers.

We continue to act as a catalyst in advancing the media landscape for the benefit of our stakeholders and our clients

GroupM also remains active in branded entertainment and content development, with specialty units at each of our agencies producing a wide range of engaging, results-oriented projects such as webisodes and reality TV shows. In one of the most interesting and important projects of the year, GroupM Entertainment played a key role in the production of a new We Are The World song and video, which reprised the iconic 1985 anthem. The project’s purpose was to benefit the Haitian earthquake relief efforts and the rebuilding of Haiti. GroupM Entertainment served as an executive producer along with famed music producer Quincy Jones and singer/songwriter Lionel Richie. The world premiere of We Are the World 25 for Haiti aired during NBC’s coverage of the Opening Ceremony of the Vancouver Winter Olympics in February.

Overall, in 2010, GroupM made important and substantive strides toward strengthening our position in the media services marketplace. We continue to act as a catalyst in advancing the media landscape for the benefit of our stakeholders and our clients. Our goal is to take an aggressive and progressive stance toward any and all initiatives that will improve the competitive advantage we bring to our clients.